Asian stock markets extend rally on Wall Street gains

Asian shares advanced on 6 October on a strong handover from Wall Street. Japan's Nikkei benchmark index climbed 1% to 18,183.45 points at mid-day as investors awaited the results of the Bank of Japan's two-day policy meeting, due on 7 October.

Some analysts expect the central bank to step up its stimulus programme amid stagnant growth and persistently weak inflation. US stocks gained ground in Wall Street overnight, with the Dow Jones and S&P 500 share averages both advancing 1.8% on bets the Federal Reserve will hold off on raising interest rates until 2016.

Risk sentiment was also buoyed by China's official purchasing managers' index – a key indicator of manufacturing activity – beating analyst expectations in September. "Asian markets seem to be reacting positively to improved sentiment around China and less US dollar strength," said Angus Nicholson, market analyst at trading firm IG in Melbourne. "The Chinese PMIs seemed to have eased fears that the economy would collapse while the US non-farm payrolls numbers have pushed back the likely date of a rate rise by the Fed into 2016."

Australia holds rates

Australia's S&P/ASX 200 index was up 0.7% at 5,184 points after the Reserve Bank of Australia (RBA) kept its benchmark lending rate unchanged at a record low of 2% for the fifth month in a row.

Australia's central bank has kept interest rates at a record low of 2% since MayReuters

In a statement, RBA Governor Glenn Stevens said low interest rates remained "appropriate" for the time being. "Further information on economic and financial conditions to be received over the period ahead will inform the board's ongoing assessment of the outlook," he stated.

Official data released by the Australian Bureau of Statistics showed the country's trade deficit unexpectedly widened to A$3.1bn (£1.5bn; €2bn; $2.2bn) in August from A$2.8bn in July. Exports were flat compared to July while imports edged up 1%.

In South Korea the Kospi index climbed 0.6% to 1,989.33 points, while Hong Kong's Hang Seng edged 0.1% higher to 21,881.73. Elsewhere in the region, India's Sensex was up by 0.5% in early trading. Mainland Chinese markets remain shut for public holidays.